Macy’s says employee hid up to $154 million since 2021

Macy’s on Monday said an employee responsible for managing accounting for small package deliveries concealed up to $154 million in expenses over the course of nearly three years.

The person who allegedly hid the money is no longer with the company, the department store operator said Monday morning, ahead of its third-quarter earnings report. The company, whose statement on the matter didn’t say when the person left the job, didn’t immediately respond to a request for comment.

Macy’s said it discovered the issue while preparing its financial report for the three-month period ending Nov. 2. It was due to deliver results before U.S. stock markets opened Tuesday morning, but it has delayed releasing its full results until Dec. 11 to allow an independent investigation to wrap up.

The company said the employee, who was responsible for the accounting of small package delivery expenses, “intentionally made erroneous accounting accrual entries” to hide about $132 million to $154 million from the fourth quarter of 2021 through the most recently completed quarter. Macy’s said its delivery expenses totaled around $4.36 billion during that period.

The independent investigation hasn’t identified any other Macy’s employee, the company said.

“At Macy’s, Inc., we promote a culture of ethical conduct. While we work diligently to complete the investigation as soon as practicable and ensure this matter is handled appropriately, our colleagues across the company are focused on serving our customers and executing our strategy for a successful holiday season,” CEO Tony Spring said in a statement Monday morning.

Macy’s declined to comment further on the alleged fraud.

The announcement comes at a difficult time for Macy’s, which is indelibly tied to the holiday season through the film “Miracle on 34th Street” and the Macy’s Thanksgiving Day Parade.

Its sales have slumped as the company has underperformed for the past decade. In February, the retail chain said it would close 150 stores nationwide in a reorganization initiative to focus on luxury sales.

The move will leave 350 Macy’s locations, as well as Bloomingdale’s and Bluemercury beauty and skin care stores, which the company said have been “outperformers” within the Macy’s portfolio.